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Senate Campaign Money Pours Into Leaders'Super PACs

Sept. 21 — Campaign money pouring into super political action committees closely linked to Senate
Republican and Democratic leaders is expected to finance a high-stakes television
advertising battle in the final stretch of important Senate races, the latest campaign
finance disclosure reports filed with Federal Election Commission indicated.

Meanwhile, other campaign spending groups that have been sponsoring TV ads until now
are expected to ease up in the final weeks of the campaign, switching to other types
of electioneering efforts to help elect favored candidates. An example is the Koch
network of conservative groups, including Freedom Partners and Americans for Prosperity,
which have provided millions of dollars in support to Republican Senate candidates
this year.

James Davis, a spokesman for Freedom Partners, said that the network groups tied to
Charles and David Koch, who head Koch Industries Inc., plan to shift away from TV
ad spending in the final weeks of the campaign to concentrate on direct voter mobilization
through canvassing and other efforts on the ground.

Continuing the air war will be the leading Republican and Democratic super PACs, the
Senate Leadership Fund and the Senate Majority PAC, which are expected to dominate
television advertising in the final weeks of the campaign.

These super PACs had a combined total of more than $50 million in cash on hand at
the beginning of September, according to the latest FEC reports. The money is expected
to be spent on ads in just a handful of states, including New Hampshire, Ohio and
Pennsylvania, with races that will decide majority control of the Senate on Election
Day Nov. 8.

Republican Super PAC Has Advantage

The leading Republican super PAC, the Senate Leadership Fund, which is closely linked
to Senate Majority Leader Mitch McConnell (R-Ky.), reported a total of $28 million
in contributions in just the month of August, according to its latest FEC report filed
Sept. 20. That included an eye-popping $20 million contribution from one married couple:
Las Vegas Sands Corp. casino owner Sheldon Adelson and his wife Miriam.

The Democrats' PAC has raised a total of more than $40 million in the current election
cycle through Aug. 31, mainly in large contributions from unions and wealthy individuals.
The Senate Majority PAC had more than $12 million in cash on hand for the final two
months of the general election campaign.

That total was far outstripped by the Republicans'
Senate Leadership Fund, which has raised a total of nearly $51 million and had more
than $40 million on hand for the final stretch of the campaign—more than three times
as much as the Senate Democrats'
super PAC.

The money collected by the Senate Leadership Fund and the Senate Majority PAC is expected
to be spent mainly in TV ads in critical states. Meanwhile, the pro-Republican Koch
network groups say they will shift to grass-roots voter mobilization, and Democratic-leaning
unions and liberal groups may do the same.

Koch Groups ‘Double Down' on Voter Contact

Davis, the Freedom Partners spokesman, told Bloomberg BNA in an e-mail: “As we get
closer to the election, the airwaves get more and more crowded and ads are less impactful,
but we will continue to monitor television advertising and look for strategic opportunities
to go back up.”

“We've also been able to more narrowly define our turnout universe from 10 million
across 8 states to 5 million,”
he said. “Therefore, we've decided to double down on direct voter contact and prioritize
grass roots, digital, direct mail, and phones over television advertising.”

Freedom Partners Action Fund, the super PAC funded by Koch Industries Chairman Charles
Koch and others, has sponsored more than $26 million worth of TV ads in pivotal Senate
races this year but appeared to be winding down its ad spending as the election draws
closer. The super PAC reported to the FEC that it had less than
$3 million in cash on hand at the end of August after spending over
$9 million during that month.

AFP, the Koch-backed nonprofit organization that handles most of the Koch network's
canvassing and voter mobilization activities, doesn't report it's fundraising activities
to the FEC. The organization has reported more than $6.2 million to the FEC in spending
for “express advocacy” activities calling for votes for or against candidates. This
includes some TV ad spending, along with mailings, digital ads and other campaign
messaging.

AFP recently announced “seven-figure”
TV ad buys opposing Democratic Senate candidates in Florida and Pennsylvania, which
the group said would be aired in addition to grass roots efforts that include knocking
on tens of thousands of doors and placing hundreds of thousands of phone calls.

AFP Attacks McGinty, Murphy

The most recent AFP ads attacked Democrat Katie McGinty in Pennsylvania, who is challenging
incumbent Sen. Pat Toomey (R-Pa.). The ads accused McGinty of giving “handouts” to
failed corporations as head of Pennsylvania's Department of Environmental Protection.

In Florida, the AFP ads attacked Rep. Patrick Murphy (D-Fla.) in his Senate race against
incumbent Sen. Marco Rubio
(R-Fla.). The ads attacked Murphy for supporting an immigration program known as EB-5
that allows wealthy foreign investors to have a path to U.S. citizenship. AFP cited
campaign finance reports indicating beneficiaries of the program made contributions
supporting Murphy.

Asked if it was fair for AFP, which doesn't disclose its donors, to criticize Murphy
based on reported contributions, an AFP spokesman and the nonprofit organization viewed
the two questions as separate.

“The privacy of our donors is a separate issue” from the group's ads, Andres Malave,
spokesman for the Florida chapter of Americans for Prosperity, told Bloomberg BNA
in a phone interview. He said that AFP's donors “have a First Amendment right” to
contribute without having their identities disclosed.

The group, which operates as a “social welfare” organization under Section 501(c)(4)
of the tax code, was founded and continues to be supported by the Kochs, but details
of its financial support, including other donors, have never been revealed.

Most Expensive Races

The Pennsylvania and Florida races are two of about a half-dozen close Senate contests
that are expected to determine control of the Senate and they have drawn the most
campaign money this year.

Spending in these races is expected to again challenge records after a 2014 campaign
season that saw spending in Senate races reach $100 million for the first time (214 DER A-1, 11/5/14).

Total spending in the North Carolina Senate race in 2014, for example, reached more
than $115 million, according to FEC reports analyzed by the nonprofit Center for Responsive
Politics. The second-most expensive race that year was in Colorado, reaching a total
of more than $98 million.

The shoe is on the other foot this year, with nearly all of the most expensive races
involving Republican incumbents fending off Democratic challengers. These include
the Toomey-McGinty race in Pennsylvania and the Rubio-Murphy race in Florida. Other
high-stakes race include Ohio, where incumbent Sen. Rob Portman (R-Ohio) faces Democratic
challenger and former Ohio Gov. Ted Strickland (D) and New Hampshire, where Republican
incumbent Sen. Kelly Ayotte faces Democratic challenger Maggie Hassan.

The Pennsylvania race leads all other Senate contests this year in terms of campaign
spending, with more than $76 million in total, so far, from candidates and outside
groups, according to the Center for Responsive Politics. That is followed by Ohio,
with over $60 million in total spending, New Hampshire, with nearly $55 million.

Big Donors Shun Trump

The surging spending in Senate races, especially by outside groups, appears to be
driven at least partly by the fact some of the biggest donors on the Republican side
are directing their money down the ballot due to a lack of enthusiasm for Republican
presidential nominee Donald Trump.

The most recent FEC reports showed Trump continuing to run behind Democratic nominee
Hillary Clinton by almost 3-to-1 in terms of campaign money raised by the candidates'
primary campaign committees and supporting super PACs. Clinton's fundraising total
stood at about $519 million at the beginning of September, compared to about $190
million for Trump, FEC reports analyzed by the Center for Responsive Politics showed.

A new report on TV ads being aired in the presidential race indicated this imbalance
in funding is being reflected in the number ads actually appearing for each candidate.
The nationwide
study by the Wesleyan Media Project, affiliated with Wesleyan University in Middletown,
Conn., found that, since mid-August, when the Trump campaign began airing ads in the
general election, ads intended to benefit Clinton have outnumbered ads benefitting
Trump be more than 2-to-1.

The Clinton campaign and allied organizations—including the super PAC Priorities USA—have
aired almost 62,000 ads, compared with about 27,000 spots by Trump and groups that
support him, the Wesleyan study found.

The study noted overall presidential ad volume in the general election continues to
remain lower than in the 2012 campaign. While ads on the Democratic side are down
somewhat from the last presidential election, ads on the Republican side are down
sharply, due to lack of outside spending in the presidential race.

Trump ads sponsored directly by his campaign have reached a level similar that of
Republican presidential campaign of Mitt Romney in 2012, the Wesleyan study found.
But, there has been a 90 percent drop in outside group ads benefiting the Republican
nominee, leaving Trump lagging behind Clinton in ad volume in most media markets.

“It seems clear that the party committees and especially pro-Republican groups are
putting more energy into the race for the U.S. Senate than they are for the White
House,”
said Michael Franz, co-director or the Wesleyan Media Project.

To contact the reporter on this story: Kenneth P. Doyle in Washington at
kdoyle@bna.com

To contact the editor responsible for this story: Heather Rothman at
hrothman@bna.com

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